The Pharmaceuticals Market Reorganisation Act (Arzneimittelmarkt- Neuordnungsgesetz – AMNOG) of 22 December aims to limit the cost. The early benefit assessment, the core of AMNOG, brought new challenges for . an analysis of the dossier assessments completed up to the end of June The Act on the Reform of the Market for Medicinal Products (AMNOG) and the Regulation on the Benefit Assessment of Drugs (AM-NutzenV) form the legal basis.
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The Act on the Reform of the Market for Medical Products Arzneimittelmarkt-Neuordnungsgesetz — AMNOG of 22 December aims to limit the cost of pharmaceuticals, which has risen considerably in recent years particularly in the market segment which was previously exempt from reference prices. The Act hence obliges pharmaceutical companies to subject their new products to an early evaluation of their additional benefit by the Federal Joint Committee Gemeinsamer Bundesausschuss — G-BA after being launched on the market.
Legal foundations of IQWiG
If it is not possible to prove any additional benefit in comparison to the comparative therapy previously identified by the Committee existing standard therapythe pharmaceutical is allocated to a reference price group with comparable active ingredients. If there is no such reference 20012 group, the National Association of Statutory Health Insurance Funds GKV-Spitzenverband — GKV-SV negotiates with the pharmaceutical company on a refund rate which does not lead to higher annual therapy costs than the expedient comparative therapy.
If an additional benefit is proven to exist, the National Association of Statutory Health Insurance Funds negotiates with the pharmaceutical 2021 a supplement on top of the price of the expedient comparative therapy. This amount then applies to all persons with statutory insurance, as well as to those with private insurance. For the first time, the AMNOG seriously tackles the price monopoly of the pharmaceutical industry in Germany with this central arrangement.
The enactment of the Act on the Reform of the Market for Medical Products AMNOG causes an early assessment of additional benefit to be carried out for each year from 1 January onwards for eligible new pharmaceuticals launched on the German market which have new active ingredients or new combinations of active ingredients. These are new pharmaceuticals to which patent protection, specialists speak of confidentiality protection, applies.
Until the AMNOG procedure has been completed, the price set by the pharmaceutical company itself applies amng the new pharmaceutical for one year. It is decisive for an evaluation amnoog established market products whether the pharmaceuticals are significant for statutory health insurance or are in competition with pharmaceuticals which have already been evaluated. There are many pharmaceuticals on the established market which the pharmaceutical companies are marketing as an alleged innovation.
This alleged novelty however frequently only lies in a molecule variant which is not relevant to the effect of the pharmaceutical. If turnover is higher, the pharmaceutical companies also need to prove an additional benefit for such orphan drugs.
In both cases, the Federal Joint Committee drafts a resolution forming the basis for negotiations on a refund rate between the National Association of Statutory Health Insurance Funds and the pharmaceutical company. The legislature has tasked the National Association of Statutory Health Insurance Funds with ensuring that new patented medicinal products are supplied at a suitable cost to the statutory health insurance funds. Suitable, in other words fair, means for us that the prices of the new medicinal products are orientated towards the additional benefit for patients, and not towards the wishes of the companies.
The Act hence obliges pharmaceutical companies to subject their new products to an early evaluation of their additional benefit, to be carried out by the Federal Joint Committee, after being launched on the market.
New medicinal products which are comparable in pharmacological and therapeutic terms with fixed-rate medicinal products are directly evaluated here in the context of a fixed rate.
This means that the additional benefit is to be proven as a therapeutic improvement within the meaning of the fixed-rate arrangement. If it is not possible for an additional benefit to be proven as a therapeutic improvement for active ingredients which are eligible for the fixed rate, the active ingredients are directly assigned to the existing fixed-rate group.
For medicinal products which cannot be directly included in the fixed-rate arrangement, the National Association of Statutory Health Insurance Funds then negotiates with the pharmaceutical company on a refund rate. This refund rate may not lead to higher annual therapy costs than the expedient comparative therapy for medicinal products with no proven additional benefit.
If several alternatives are determined for the expedient comparative therapy, the refund rate may not lead to higher annual therapy costs than those of the most economical alternative. For the first time, the AMNOG is seriously tackling the price monopoly of the pharmaceuticals industry in Germany with this central arrangement. The entry into force of the Act on the Reform of the Market for Medical Products AMNOG causes an early assessment of additional benefit to be carried out for each year from 1 January onwards for eligible new medicinal products launched on the German market which have a new active ingredient.
Until the AMNOG procedure has been completed, that is in the first twelve months, the price set by the pharmaceutical company itself applies to the medicinal product, if it is the first time that an active ingredient has been placed on the market. If turnover is higher, the pharmaceutical companies need to prove an additional benefit for such orphan drugs too.
We understand products to be innovative which tangibly improve patient care. Each new medicinal product is not automatically better simply because it is new.
Products are repeatedly launched with a considerable amount of marketing activity which however do not in fact deliver in everyday care what they promised. Such medicinal products will have to put up with being in the second or third row in future — including when it comes to price. Such spurious innovations may only be able to just about do what other therapeutic alternatives, which often are very cheap, can also do, so that a higher price would not be justified.
Authentic innovations which constitute real progress for patient care will increase. It is only for those medicinal products that pharmaceutical anmog can expect to receive an adequate wmnog rate in future. Concerns that research results and innovations will pass Germany by are unfounded. Expensive marketing for spurious innovations in place of research for real innovations will no longer be worthwhile for the pharmaceutical companies.
Patients and contributors of the statutory and private 2102 insurance funds certainly benefit. In future, they will receive early-evaluated new, high-quality medicinal products which are better than the previous standard, for a manog refund rate.
Pharmaceutical expenditure will be 2102 by the refund rates that are negotiated under the AMNOG procedure. Where medicinal products offer no additional benefit and cannot be assigned to an existing fixed-rate group, the price level will also be limited since the refund rate may not lead to higher annual therapy costs than those of the expedient comparative therapy.
If several alternatives for the expedient comparative therapy are identified, the refund rate may not lead to higher annual therapy costs than those of the most economical alternative. Both statutory and private health insurers can presume in future that high refund rates are indeed countered by a corresponding additional benefit for patient care, and that they do not have to finance spurious innovations which all too frequently are excessively expensive, 2021 they used to have to.
Lower expenditure on medicinal products with no additional benefit means that the probability of additional contributions and contribution amhog falls.
Pharmaceutical companies will benefit from the new arrangements in the medium term. Pharmaceutical companies may expect in future to receive a suitable refund rate for real innovations. Furthermore, pharmaceutical companies will zmnog be virtually free of the risk of their products not being eligible for refund by the statutory health insurance.
The legislature has almost completely restricted an exclusion procedure based on a lack of economic viability. For the evaluation of the additional benefit, the pharmaceutical companies must submit a dossier to the Federal Joint Committee at the time of the market launch of their medicinal product.
The pharmaceutical company has a right to consult on the dossier with the Federal Joint Committee at an early date e. On the basis of the dossier, the Federal Joint Committee examines the additional benefit of the new medicinal product as described by the pharmaceutical company. The early additional benefit evaluation is completed and published at the latest three months after the market launch of the medicinal product.
The Federal Joint Committee decides within another three months after publication how the patient-relevant additional benefit of the new medicinal product is to be classified. Prior to this, the companies in question may make a statement in a written and oral statement procedure. The Federal Joint Committee deals with the arguments that have been put forward and then adopts annog resolution. This resolution of the Federal Joint Committee is published.
After the resolution of the Federal Joint Committee, negotiations on a refund rate for medicinal products with an additional benefit for patient care are taken up between the National Association of Statutory Health Insurance Funds and the pharmaceutical company negotiations in accordance amng section b of Book Five of the Wmnog Social Code [SGB V].
The starting point here is the proven additional benefit in comparison to the expedient comparative therapy. Negotiations are hence carried out on a supplement towards or deduction from the costs of manog expedient comparative therapy amnogg line with the proven additional benefit.
New medicinal products with new active ingredients which are comparable in pharmacological and therapeutic terms with fixed-rate medicinal products are directly included here in existing fixed-rate groups where the additional benefit was not demonstrated as a therapeutic improvement within the meaning of the fixed-rate arrangement.
The fixed rate is a maximum refund up to which the statutory health funds assume the costs of specific medicinal products prescribed by physicians. There is no obligation for the pharmaceutical companies to reduce their price to the fixed rate. However, other medicinal products of the same fixed-rate group are available in such a case for patient care at the fixed rate or lower.
For medicinal products with no proven additional benefit, the National Association of Statutory Health Insurance Funds negotiates a refund rate with the pharmaceutical company in accordance with section b of Book Five of the Social Code.
The refund rate amnogg such medicinal products may not be higher than the cost of the expedient comparative group with which the new medicinal product was compared. If several aknog are determined as among expedient 20112 therapy, the refund rate 2021 not lead to higher annual therapy costs than the most economical alternative. The refund rate that was negotiated applies to persons with both statutory and private insurance, and to self-paying patients in Germany.
The refund rates which were negotiated apply from the first day of the 13th month after first being launched on the market. At federal level, the negotiated refund rate may be followed by selective contracts between individual health insurance funds or their associations, and the pharmaceutical companies.
If no agreement can be reached within six months on a refund rate between the National Association of Statutory Health Insurance Funds and the pharmaceutical company, the proceedings go to arbitration. The arbitration body is composed of three non-partisan representatives and two amnogg each of both negotiation partners. The pharmaceutical company can apply to the Federal Joint Committee for a renewed benefit evaluation if new scientific findings are available. This is however only possible at the earliest one year after publication of the resolution on the early additional benefit evaluation.
After an arbitration award has been handed down, both sides of the negotiation can apply to the Federal Joint Committee for a cost-benefit valuation. The benefit of a medicinal product is understood to mean its therapeutic effect as relevant to amngo.
Major criteria are improving the state of health, shortening the period of illness, extending survival, reducing side-effects or improving quality of life. A medicinal product which wishes to distinguish itself from the expedient comparative therapy must exceed the benefit of this therapy, that is it must have an additional benefit in the stated categories. The result of the examination, and the resolution of the Federal Joint Committee based on it, then act as a barrier: Either the medicinal product is allocated to the fixed-rate arrangement, or negotiations are carried out with regard to a refund rate in accordance with section b of Book Five of the Social Code.
Since the AMNOG provisions came into force, legislature has presumed that a new medicinal product has a fictive benefit as a result of its approval under the law on medicinal products. When it comes to ammnog, however, only effectiveness, quality and safety are examined and the market launch is regulated by weighing up benefits and risks.
No assessment along these social law criteria additional benefit is carried out on approval. Whilst a,nog early 20122 evaluation in accordance with section 35a of Book Five of the Social Code is a differentiated finding as to the probability and extent of the benefit in comparison amog the expedient comparative therapy, the focus of the evaluation in the fixed-rate arrangement is different.
Here, the benefit in comparison to other medicinal products of a fixed-rate group takes on a major role in proving a therapeutic improvement. Accordingly, in the early aknog evaluation, new medicinal products that are comparable in pharmacological and therapeutic terms with fixed-rate medicinal products are directly evaluated within a fixed-rate context section 35a subsection 1sentence 4, of Book Five of the Social Code.
This means that the additional benefit is portrayed not in differentiated grades and probabilities, but exclusively anog a yes-no decision regarding whether or not a therapeutic improvement is proven within the meaning of the fixed-rate arrangement.
Indications or notes by themselves are therefore fundamentally unsuited to prove a therapeutic improvement. If for active ingredients that are eligible for a fixed rate the additional benefit in accordance with section 35a of Book Five of the Social Code cannot be proven as a therapeutic improvement in accordance with section 35 section 1bsentences 1 to 5, of Book Five of the Social Code, the active ingredients are directly assigned to the existing fixed-rate group.
These statutory stipulations are complied with 0212 the Federal Joint Committee by submitting a separate dossier for medicinal products that are comparable with fixed-rate medicinal products in pharmacological and therapeutic terms Annex VI to the 5th Chapter of the Rules of Procedure of the Federal Joint Committee.
The Amhog Joint Committee defines the expedient comparative amnoy according to transparent procedural criteria. What criteria are applied when determining the expedient comparative therapy is described in section 6 of the amngo Chapter of the Rules of Procedure of the Federal Joint Committee.
The expedient comparative therapy is the generally-recognised standard therapy in the respective area of application.
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Since it is the standard with which a new medicinal product is compared as to its additional benefit, it is of central importance. In accordance with the principles applied by the Federal Joint Committee, the expedient comparative therapy must comply with the international standard of evidence-based medicine and be licensed in Germany. If there are several indications, several comparative therapies may also be defined. The standard in an area of application does not necessarily have to be a medicinal product from the same class of active ingredients.
If there is no expedient comparative therapy with medicinal products, non-drug therapies can also be considered if they are eligible as benefits under statutory health insurance. These therapies must also comply with the generally-recognised state of medical knowledge within in the range that is relevant to the application. It is however also possible to compare with non-treatment.